We recently worked with reporter Craig Guillot, a business and personal finance writer from New Orleans, on an article for Mint.com about starting an emergency fund. You can check out the full article here.
In working with Craig on the article, we made the point about how a Roth IRA account can sometimes do “double duty” as a retirement account and an emergency account. Many people think penalties apply if they withdraw their Roth IRA contributions. Not so. Tax and penalties may apply to withdrawals of earnings, but not to withdrawals of annual contributions. This is often mis-reported in personal finance articles. I don’ want to encourage anyone to withdraw their Roth IRA funds early. But if push comes to shove, you do have the ability to do so. We’ll talk more about retirement contributions as we get closer to the deadline of April 17, but for now let’s just say that Roth IRA accounts are great, and don’t neglect making an annual contribution if your income level makes you eligible to do so.
On a separate note, for those of you not already familiar with the Mint.com site, go take a look. It’s worth a visit. I would characterize Mint.com as the easy-breezy online version, and Quicken as the more structured and time-tested version of the personal finance program. You might want to give serious consideration to using Mint or Quicken if you need help tracking your cash flow. Overspending is one of the most critical challenges our clients face. If you overspend, you are unlikely to reach your financial goals and your money will probably run out too early in retirement. The first step in getting a handle on your cash flow is knowing exactly where the money goes. If this is a problem for you, take a look at Mint.
Mint.com also features a bunch of consumer-friendly and accessible articles, prepared by writers like Craig, that can help give you a painless introduction to what’s trending in personal finance. It’s short, it’s sweet, and it’s not intimidating.
By the way, Craig is the author of a new book coming out in March called “Stuff About Money: No BS Financial Advice for Regular People.” If you follow personal finance, you might also want to take a look at some of Craig’s recent posts on his blog.